Chuck Chiang: Why the Dreamliner is good for business at YVR

A China Southern Airlines Boeing 787 Dreamliner arrives at Vancouver International Airport on Wednesday February 19, 2014. The airline switched the daily Guangzhou-Vancouver route to the new aircraft to the 787 effective that day.

Photograph by: DARRYL DYCK
, THE CANADIAN PRESS

YVR officials have dubbed 2014 the year of the Dreamliner. Based on the first two months of the year, they weren’t kidding.

The Boeing-produced 787 Dreamliner has been one of the most anticipated wide-body passenger aircraft in recent aviation history. Since the plane was unveiled in 2007, airline industry officials have touted its lighter composite construction and energy-efficient engines, which together give it a 20-per-cent greater fuel efficiency than similar-sized older aircraft.

That, the industry experts said, means carriers could both reach markets not feasible with older technology and serve existing markets with higher efficiency.

In February alone, YVR has seen the fruits of that promise — twice.

Japan Airlines (JAL) landed the first Dreamliner as part of a regularly scheduled passenger service route at YVR on Feb. 3. Then last week a second airline, Guangzhou-based China Southern Airlines, also flew the Dreamliner to the Lower Mainland.

What does this mean for YVR and Vancouver’s pursuit of more passengers, routes and business?

At the very least, it appears that the city’s abundant Asian air links can be more effectively maintained.

There are currently more than 70 direct flights between Vancouver and Chinese destinations every week, more than any other airport in North America. In addition, All Nippon Airways’ new service to Tokyo-Haneda and JAL’s 787 announcement has re-focused Japan has an access point to East Asia. Service to airports such as Seoul-Incheon and Taipei are also viable options with this aircraft.

Some have questioned this many — even for a region as closely linked to Asia as Metro Vancouver — can make sense long-term economically. After all Vancouver’s population, economic clout and air service demand is still dwarfed just on the Pacific Coast by that of Los Angeles, San Francisco and Seattle, and that’s not counting rising challenges from places like Calgary and Toronto.

But one of the 787’s main advantages is that it can allow carriers to serve destinations with moderate demand at a much lower operating cost. And for a medium-size market like Vancouver (with a dedicated and sizable — albeit smaller — group of international travellers compared to some other cities), that could be the difference between having and not having a route in the long term.

Japan Airlines officials have already said they studied the profit potential of switching from its older 767s — with 232 seats — to the new 187-seat Dreamliners for its Tokyo-Vancouver route before deciding to phase in the new aircraft.

While Japan Airlines will gradually increase the frequency of using 787s to serve the YVR to Tokyo-Narita route until it becomes a daily occurrence in March, China Southern has taken a more aggressive strategy. It switched all its daily Vancouver-Guangzhou flights to the Dreamliner effective immediately. Officials from the airline said they would have done it sooner, had delays in the planes’ delivery from Boeing not happened.

This allows China Southern to more efficiently serve Vancouver while it looks to aggressively bolster its Guangzhou hub — already having similar geographical advantages as neighbouring Hong Kong — to challenge other Asian airports for international travellers’ business. (Incidentally, the carrier announced a Guangzhou-New York direct service, days after making the Vancouver announcement.)

This isn’t taking into account Air Canada’s expected fleet of 787s; the carrier will start taking delivery of its Dreamliners this spring. While it is not a sure bet if Vancouver will see these aircraft, conventional wisdom — and the fact that YVR remains Canada’s pre-eminent gateway to the Asia-Pacific region — says that it is likely.

So, expect more Dreamliners landing and taking off at YVR soon. And that’s a good thing for Vancouver’s economic competitiveness.

A China Southern Airlines Boeing 787 Dreamliner arrives at Vancouver International Airport on Wednesday February 19, 2014. The airline switched the daily Guangzhou-Vancouver route to the new aircraft to the 787 effective that day.